The sector has to respond to change facilitated by technology and to new demands and lifestyles of customers looking for an experience. Owners no longer only require a manager who manages occupiers and collects rent. They need experts in technology, digital marketing and data, together with architects who can exploit these trends.
Retailers have advanced along the path of change. Rather than having separate teams running virtual and physical shops, they now see the two as complimentary and both are integrated to meet customers’ preferences. Online is here to stay and will play a material role in customer´s choices, but there will be limits to its penetration and we can influence the extent of the physical experience. Today customers tailor their retail journey to their personal lifestyle and preference. Each decides which parts are carried out online and which in the physical shop.
The equation between the two will vary on the product/service required and the individual’s choice. This creates a complex environment for owners and operators, but both have an aim to make the journey seamless. Excellence of service is critical to success, given that the customer will have more choice and must feel a sense of belonging. ‘Customer creation’ or ‘co-marketing’, whereby customers are encouraged (and often rewarded) to contribute ideas to the design or marketing of a product can be used to ensure engagement.
For retail centres to maintain competiveness, society (via the public administrations) needs to decide on rules for the new technology- drones are already playing a role in logistics, but how will they operate from a retail centre? Shared transport and autonomous cars provide other challenges, as may robots and 3D printing.
The complexity of the retail matrix means we need data to understand the customers’ varied requirements and preferences. However big data brings its own challenges- the risk of data overload. Evaluating what data is relevant and its usefulness is critical. For example, customers want to receive their purchases when and where they want. This is a very emotive part of the chain. The psychology of choice and reliability are critical aspects we need to understand better.
Commentators say that internet will destroy physical retail. However, the debate should not be about virtual or physical retail- it should be about harnessing both. Humans are complex creatures and the social aspect of our lives is key. We need to experiment to a degree, suffering some failures, but requiring a corporate culture of learning rather than punishing. An off the peg suit’ will not fit everyone- we need ‘made to measure’- to cater for differences in culture, lifestyle and working hours, which affect customer preferences. Those who provide a product fully integrated into a digital world and catering for as wide a range of choice as possible will be well rewarded.